The existing value added tax (VAT) system in the European Union is not applicable in Saint Martin. On the other hand, there is a turnover tax known as the general turnover tax (TGCA), the rate of which is low (4%), which in practice reaches retail sales of goods Of services.

This tax makes use of concepts close to those governing VAT as regards its scope, the definition of taxable persons, the rules governing its operative event and its exigibility and the rules on territoriality.

This tax is neutral for businesses with respect to retail sales (which are taxable only). Companies only collect it from their clients and transfer it to the public accountant of the community.

The same applies to the provision of services invoiced to private individuals. On the other hand, companies that use service providers (bookkeepers, telephone operators, subcontractors, etc.) or acquire fixed assets bear the TGCA invoiced by their suppliers. The latter is not attributable to the collected TGCA But is only deductible from taxable income (in the form of an expense or amortization expense).